CETA and Europes Arctic

Stefan Kirchner

www.crosslegal.com

The texts collected in this document were first published in the blog
rladi.com in May and July 2015 and are available free of charge from both
rladi.com and scribd.com.

Riding the Invisible Train:

Finland and Sweden as Beneficiaries of CETA
For many local communities across Europe, CETA is like an
invisible train. Trains can bring you to new places. But they can
also get you killed if you walk in front of them. A lot of
municipalities are still unaware of the eects CETA will have on
them and as far as I have been able to find out, this also applies to
the national Smi Parliaments. For many local communities, the
situation with CETA right now is that they might (or might not)
have heard about the existence of trains but they have never seen
one and cannot imagine how one looks like. And right now they
are walking around a corner and are about to step on railway
tracks which were not there yesterday and the train is coming. You
can get hit by the train or you can jump on it and see how far it
takes you. You cannot stop it. Local communities have to deal
with this reality. In Finland, the situation is not that troubling
because the threshold beyond which public procurement rules
apply is already below 228,000 EUR in many cases. Finnish local
authorities therefore should not have too many problems dealing
with CETA-related procurement challenges. Due to concerns and
experiences which they share with Canada, Finland and Sweden
are in a particularly make use of the future free trade agreement
between the EU and Canada.

Applicability of CETA procurement rules under Annex X-02

Annex X-02 to CETA regulates the applicability of CETA
procurement rules to so called sub-central government entities,
such as regions or municipalities. Other entities to which CETAs
public procurement rules apply are covered by Annexes X-01 and
X-03 respectively. Unfortunately, Annex X-02 is not as helpful for
European CETA users as it is for Canadians, because what that
annex gives you is essentially a list of all sub-central entities in
Canada, sorted by province, to which CETAs procurement rules
apply. This includes usually not provincial legislative assemblies
but it does include the Aboriginal Aairs Secretariat in New
Brunswick, as a branch of the executive. According to CETE, this
does not include procurement subject to the Nunavummi
Nangminiqaqtunik Ikajuuti Policy. This policy makes it easier for
firms from Nunavut to find customers. But just how far the
procurement restrictions in CETA go becomes clearer when we
look at the situation in Nunavut, Ontario, Sasketchewan,
Newfoundland and Labrador, the Northwest Territories, Manitoba,
British Columbia, Alberta, Prince Edward Island which all use the
same phrase (and eectively the situation is the same at least in
New Brunswick for which a detailed list of covered institutions is
provided), this includes a whole range of educational institutions.

Free Trade in the Global North: CETA and Local Communities

In May 2015, the Universit degli Studi di Veronas Doctoral
School of Legal and Economic Sciences organized a seminar on
Austerity, Solidarity and Supranational Policies in the European
Union. I had the honor of participating in the panel on new
supranational developments and to give a presentation on Local
Self-Government and the Environment as Concerns in the Context
of the Comprehensive Economic and Trade Agreement between
the European Union and Canada (CETA). While CETA is not yet
binding, the draft text which was published in September 2014
already indicates that it will have eects on municipalities and
other forms of local and regional governance. Especially in
countries with strong local administration competencies, local
communities will no longer have the freedom to oer incentives
for foreign investors if there is a direct benefit to the local
community. This might raise a number of issues in particular in the
Canadian Arctic where indigenous corporations currently enjoy a
special legal status and where e.g. mining companies have
committed themselves to hiring local and indigenous workers. If
CETA enters into force in the current form, this can bring
significant challenges to local communities. But in particular for
the Arctic member states of the EU, CETA can provide significant
benefits as existing close ties to Canada could be utilized in order
to gain intra-EU advantages and thus increase trade-related
profits. During the presentation it was emphasized that local
communities will require adequate awareness of CETA in order to
benefit from the future trade deal rather than to suer negative

consequences. For the time being, such awareness on the local

level seems to be lacking dramatically both in Canada in Europe.

CETA and Spmi inside and outside the EU

In the last post I had written about the potential impact of CETA
on the Smi Parlianments. But what will CETA mean for the parts
of Spmi which are not part of the EU? Russia remains a special
case in so far as there is no domestic structure which would be
truly parallel to the national Smi parliaments in the other parts of
Spmi. Smi communities in Russia will not be aected directly
but of course. Norway is not a member of the European Union but
of the European Free Trade Area (EFTA). The draft CETA text
which is currently available does not make any reference to EFTA,
nor is the EU capable of creating obligations for EFTA or EFTA
member states vis--vis third parties, in this case, Canada. There
is, however, already a free trade agreement between Canada and
EFTA, which entered into force on 1 July 2009. CETA is a much
more detailed document than the free trade agreement between
Canada and EFTA, which is largely based on ideas which can also
be found in the General Agreement on Taris and Trade
(GATT).Also, unlike the agreement between Canada and the
European Free Trade Area, CETA is the precursor to the
establishment of a super-region. A super-region is a trade block
consisting of two or more regional trade blocks. The eventual
establishment of a Transatlantic Free Trade Area (TAFTA),
consisting of the members of EU and EFTA and the parties to the
North American Free Trade Agreement (NAFTA), that is, the United
States, Canada and Mexico. The rapprochement between the
Andean Community and Mercosur in the last decade, on the other
hand, did not lead to a super-region; not simply because of

geography (all states involved are located on the South American

continent) but because there is no agreement (yet) between the
Andean Community and Mercosur. It is this potential for a future
integration which will not only be deeper integration which makes
the biggest dierence between CETA and the Canada-EFTA treaty.
CETA truly opens up markets and provides a great potential for
the citizens of both the EU and Canada. With regard to Spmi,
CETA will be a double edged sword, generating new opportunities
but also making some of the borders which tear Spmi apart more
solid.

CETA Procurement Rules and the Sami Parliament in Finland

CETA will have an impact on local communities, i.e.,
municipalities, regions, super-municipalities and potentially also
on the Smi Parliaments on the national level. In the current draft
text of CETA they are not mentioned but the applicability of CETA
procurement rules cannot depend on decisions by national
authorities. Smi Parliaments are somewhat dierent from other
public actors but they, too, cannot ignore the obligations CETA will
bring. After all, they do play a role in the decision making
processes of the state. For example in Finland, the Smi
Parliament has only a consultative function and according to
Section 1 paragraph 2 of the laki saamelaiskrjist, the Act on
the Smi Parliament (ASP), falls under the purview of the Ministry
of Justice. But the function of the Smi Parliament is not limited
to making the voice of the Smi people heard in relation to the
state or to represent the Smi people. When it comes to CETA,
however, this can raise a number of questions for the Smi
Parliament because it might find itself bound by CETA rules, an
issue which still needs clarification. While the challenges provided
by CETA will not be insurmountable, it is necessary for the Smi
Parliament to be aware of these rules.

CETA is not yet binding and the final text has not yet been
published. It is, however, already clear that there will be
challenges. One of the are the procurement rules included in
CETA. While the current law in Finland does not provide for
challenges to the way the Smi Parliament spends its money

(which might imply being excluded from Finnish procurement law),

it remains to be seen whether this special treatment can continue
once CETA will have entered into force. CETA will provide
opportunities in the future. Today, it provides questions.

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